Snapshot: A Limit To The Madness
The Boston Herald reports from Massachusetts. “Local real estate experts remain bullish about the Greater Boston market but stressed the need for workforce housing and warned of a potential luxury residential glut. ‘This certainly feels like a high-water mark for me,’ said John Hynes III, CEO of Boston Global Investors. ‘I’m talking about all sectors.’”
“While developing middle-market properties is challenging, ‘the appetite for assets are so extraordinary, and cap rates are so compressed, who would have thought you could sell properties in Allston for $560 a foot?’ said Bruce Percelay, chairman of the Mount Vernon Co., a Boston apartment developer and owner, referring to three projects his company is selling. But, Percelay said, ‘We do see concerns of overbuilding in the luxury market,’ noting a report of a new Boston luxury apartment building offering three months free rent as incentive — even before a new wave of luxury apartments come online.”
The Dallas Morning News in Texas. “Home sales have been down from a year ago in five of the eight months so far in 2014, the North Texas Real Estate Information Systems reports. David Brown, regional director for housing analyst Metrostudy, said he was surprised that August home sales were down in North Texas. ‘We believe the slight decline in activity is due mostly to the lack of available inventory,’ Brown said. ‘But it also has to do with prices increasing faster than incomes.’”
“Home prices in the Dallas-area have risen by more than 40 percent since the worst of the recession. Some North Texas home sellers may be overreaching. More than 30 percent of houses listed for sale in the Dallas-Fort Worth area have had their prices lowered, according to Redfin.”
The Denver Post in Colorado. “The Denver area housing market in August softened as the summer selling season began to end, according to Metrolist. Prices dipped, the number of sold listings decreased and homes stayed on the market longer, Metrolist CEO Kirby Slunaker said. The median sold price in August was $277,000 compared with $283,000 in July. Slunaker said the softening in the Denver metro housing market is the rule rather than the exception as children head back to school. ‘The summer selling season was strong, and in many areas remains very active, with buyers quickly making offers on properties that are priced right,’ Slunaker said in a statement.”
Honolulu Magazine in Hawaii. “Oahu home sales lost some steam last month after a record run this year. Home prices and the number of sales dipped for the first time this year in August compared to the same month a year ago, according to the Honolulu Board of Realtors. The median sales price of a single-family home fell 2.3 percent from $665,000 to $650,000. This is coming off a record-breaking June where prices soared to a median sales price of $700,000 for single-family homes.”
“‘August was an interesting month for the Oahu housing market,’ said Julie Meier, president of the Honolulu Board of Realtors said in a statement. ‘Inventory of both single-family homes and condos is climbing, which will help the market meet demand,’ she said.”
The Las Vegas Sun in Nevada. “Las Vegas housing prices were flat last month as the market slows down from its meteoric recovery from the recession. ‘It was only a matter of time before we stopped seeing home prices rise by double-digit percentages,’ GLVAR President Heidi Kasama said in the report.”
“The slowdown comes as would-be buyers increasingly ignore listings. By the end of August, 7,788 single-family homes were listed without offers, up 38.8 percent from a year ago, the GLVAR reported. Overall, 2,567 single-family homes were sold last month through the GLVAR’s listing service, down 12.8 percent from a year earlier. Housing prices soared the past two years as investors bought cheap homes in bulk to turn into rentals. But faced with rising prices they helped create, investors have been scaling back on local purchases in recent months. And many locals, hoping to cash in on the recent upswing, have been overpricing their homes and refusing to budge.”
The Baltimore Sun in Maryland. “The median home price in the Baltimore metro area fell in August for the second month in a row as the number of the homes on the market continued to rise. The median sales price for the region dipped to $245,000, dropping 2.8 percent last month compared with the same period in 2013, according to the survey by a subsidiary of the MRIS multiple-listing service. August marked the 11th consecutive month of year-over-year increases in inventory, with 13,940 homes for sale, 24 percent more than a year ago.”
“Roughly 4,435 homes entered the market last month, a nearly 9 percent year-over-year increase and the 17th straight month of annual growth in new listings. In the Baltimore region, the number of foreclosures climbed to 393, up nearly 50 percent from a year ago, according to the RBI report. ‘There’s less competition among buyers because there’s more inventory,’ said Corey Hart, senior product manager for RBI. ‘That can have a leveling effect on prices.’”
The Eagle Tribune on New Hampsire. “Jim D’Amico of Century 21 North Shore’s Derry office said he has more properties to work with in the past few months and most are traditional home sales. Century 21 North Shore has 500 listings in its 17 locations. That is a 78 percent increase from last year. D’Amico warns sellers that pricing homes too high can have negative effects. ‘There is a limit to the madness. I think that some of the reasons why there are properties still on the market is that people are too aggressive with their prices,’ he said.”
It’s like ebola.
‘Lackluster. Lethargic. Stagnant. Pick your favorite adjective. All of them have been used to describe the recent state of the D.C. region’s housing market. Buyers are showing no eagerness to jump into the market despite mortgage rates floating along at yearly lows for the past couple of months. Tougher mortgage standards have kept some first-time buyers out of the market. Uncertainty about the economy has other buyers leery of making large purchases. And those home buyers who refinanced at historic low rates are reluctant to move.’
‘Data from the Houston Association of Realtors show a slight pullback in the market in past months, with the number of available listings creeping up and inventories on a slight incline.’
“The market has definitely softened somewhat, especially the low end,” James Gaines, research economist with the Real Estate Center at Texas A&M University, said Wednesday.Year-over-year sales activity has been more modest, too, with the market posting its first declines in several years in three months so far in 2014.’
‘Pending sales, another telling indicator, were flat at the end of August and “may potentially signal a slowdown in sales activity when the September numbers are tallied,” the real estate association said in its monthly report.’
‘The median price for a single-family home in August was $206,000, up 10.4 percent over a year earlier. Prices hit an all-time high of $214,650 in June.’
‘Builders developed 34,000 houses last year and through July are on track for only a few more this year.’
Open house signs up all over 93021
last year none
so isn’t it more appropriate to say they’re down 4% since june?
inventory has tripled in my hood s of dc
“It’s like ebola.
… the recent state of the D.C. region’s housing market.”
Great comparison!
“Tougher mortgage standards have kept some first-time buyers out of the market.”
Why does the MSM always blame tougher mortgage standards for first-time buyers who are priced out of the market? How about the deliberate effort to push prices back up to peak housing bubble levels? Or the overhang of dismal employment prospects and student loan debt that weigh down young families’ household financial balance sheets?
Because their bosses tell them that is the reason. C’mon Uncle Sugar gimme some more easy credit.
Well they used to assign equal parts blame to lack of inventory and tougher mortgage standards. As recently as this past spring, I recall.
Now that the across the board steep inventory rises are too difficult for even the top-notch shills to deny, they have to go with what’s left, I suppose.
OTOH, if you read Ben’s snippet from the Dallas story, it looks as if some of them are still going with the lack of inventory excuse after all. Maybe because Dallas has been a bit late at arriving to the echo bubble deflation party?
“…it looks as if some of them are still going with the lack of inventory excuse after all.”
I think that they will have PLENTY of excess inventory in the near future to eliminate that excuse. PLENTY of inventory…
‘U.S. foreclosure activity jumped in August for the second consecutive month as banks started the process on more properties and scheduled more housing auctions, industry firm RealtyTrac said on Thursday. Overall, 116,913 properties were at some stage of the foreclosure process, which includes foreclosure notices, scheduled auctions and bank repossessions, the group said.’
‘Lenders filed 238 foreclosures last month in Palm Beach County, up 10 percent from a year earlier, according to RealtyTrac. Broward filings jumped 26 percent.’
‘Scheduled auctions — when a judge sets a date for a home to be repossessed — also increased in both counties.’
Florida posted the nation’s highest foreclosure rate for the 11th consecutive month. One in every 400 homes in the Sunshine State was in some stage of foreclosure, almost three times the national average, RealtyTrac said.’
‘Meanwhile, after years of foreclosure backlogs, existing cases are moving swiftly through the courts, observers say. Jerry Tepps, a foreclosure defense lawyer in Palm Beach and Broward counties, said courts are hiring retired judges and administrators to “make things happen.”
‘Tepps has a few cases that will be resolved this year, only months after they were filed. “It used to be three or four years before they were over with,” he said. “The court system has become much more aggressive in applying resources than it ever has before.”
Another one bites the dust
Another one bites the dust
And another one gone, and another one gone
Another one bites the dust
‘Across China, home buyers are exercising caution on fears that the country’s frothy property market might soon register a steep fall, as prices continue to weaken with the supply of new homes outstripping demand.’
‘When The Straits Times visited Changchun about two weeks ago, red banners running down the sides of buildings screamed steep discounts and zero down payments, a rare sight a year ago. Similarly, the city’s highways were lined with billboards promoting the latest housing projects.’
‘This reporter visited six showflats, with all the projects offering discounts. Local reports noted that more than two-thirds of the 305 housing projects in Changchun were dangling carrots to entice buyers. This proportion is the highest in a year.’
‘Starting prices, for instance, have been slashed to as low as 3,500 yuan per sq m at some projects, from average listed prices of more than 6,000 yuan per sq m.’
‘This time last year, Dr Li Jianing was busy hunting for apartments in Changchun city, the capital of China’s north-eastern Jilin province. With prices at about 7,500 yuan (S$1,530) per sq m at the time, the 46-year-old splashed out about 1.6 million yuan for two residential units in the city’s Erdao district. One was for his own use and the other, for his son.’
‘It’s a different story this year. “People are more careful; they can see the huge number of new projects,” Dr Li said, adding: “Even if I had the cash now, I wouldn’t buy.”
It’s kinda irrelevant now Dr Li, cuz you AIN’T GOT THE MONEY. You already blew it, knucklehead.
As he talks “cash flow”, it’s likely he didn’t have the money when he bought in the first place. Join the debt slaves Dr. Li.
Well, he has his son along for company.
Notice when we hear “official” numbers, even from US press, they’ll say, “prices in so-and-so Chinese city are down 1%.” Then we can find FB’s like this dope holding the bag on a 50% loss.
Some posters questioned the relevance of my Bits Bucket post on the collapse of iron ore prices this year. I am no expert on the construction practices used to build Chinese ghost cities, but I have to guess that high rise office and tours and apartment buildings have a fairly high steel content. So it should be no surprise if a slowdown in China’s real estate sector is coincidental with a collapse in iron ore prices, given that iron is an input to steel production and steel is a primary input to China-style real estate construction.
Comments?
And the appliances and furnishings and doors for those empty towers, and the conduits for the wiring and the lighting fixtures, and the car that drives the steel worker to the job and the ships that bring the ore in and the mills that process the steel and on and on.
The most interesting part is probably the leverage (and probably fraud) used to build the stockpiles of ore that are now dropping in value.
I am no expert on the construction practices used to build Chinese ghost cities, but I have to guess that high rise office and tours and apartment buildings have a fairly high steel content.
And smaller structures use rebar. I’m guesings that there is little to no wood frame construction in China. South of the US border virtually all SFHs are made of bricks, mortar and rebar.
Don’t concern yourself with them. Some posters think prices in China only matter if you are planning to buy a house there.
I guess not everyone has figured out yet that with a global credit mania underway, all real estate is global.
Analyst on WBBR this morning bemoaning the fact that China is experiencing falling prices across the board and it is accelerating.
‘After stalling amid the housing bust, a 1,400-home development in Riverside County is coming back to life. An early October grand opening is set for the first phase of Spring Mountain Ranch, a 785-acre master-planned community nestled in a canyon northeast of UC Riverside.’
‘The project — one of the largest of its kind in 20 years — represents a big bet by developer IStar Financial that the housing market in this epicenter of the foreclosure crisis has healed significantly. If the homes sell well, economists say, that could persuade others to break ground along this interior stretch, near the 215 Freeway.’
“It’s a test of starting the whole Inland Empire game again,” said Gerd-Ulf Krueger, chief economist with KruegerEconomics.’
‘The Inland Empire unemployment rate was 9.2% in July, compared with 5.7% in Orange County and 8.1% in Los Angeles County. About 18% of Inland Empire homeowners with a mortgage still owe more on the loan than their houses are worth, compared with 9.3% across Los Angeles and Orange counties, according to Zillow. And like the larger Southern California region, Inland Empire home sales are down this year and price appreciation has slowed.’
‘If homes at Spring Mountain Ranch sell well, other builders may follow, Krueger said. “They will go to their money people and say: “Look, it’s east of the 15. You are worried about being too far out in the Inland Empire. Here is a successful project. Give us money.’”
You are worried about being too far out in the Inland Empire. Here is a successful project. Give us money.’”
Give us money name of the game
‘The country’s economic slowdown and a slump in coal prices is taking its toll on the coal-rich areas surrounding the northern Chinese cities and township of Ordos, Ningdong and Yulin, with coal-mining and trading businesses in the region beginning to terminate their coal-related operations and turning to other business sectors.’
‘The “Energy Delta,” previously dubbed an economic miracle, has now been overshadowed by the drop in housing prices, population outflows and loan problems, reports the Guangzhou-based 21st Century Business Herald.’
‘During the rapid growth era, private loans mushroomed and investments were made in the real-estate market, given that housing purchases are one of few channels for people wanting to manage wealth acquired from coal mining.’
‘However, the slump in coal prices triggered a fall in housing prices, which then sparked disputes between land developers and housing buyers over losses caused by the housing price drops. People who had bought property when the price was high complained about the sudden price drops and are seeking refunds or compensation from local governments or developers, according to the report.’
Dang, this mining thing is all over the place:
‘Economic expansion in northeast British Columbia will be slow this year and next, according to a Central 1 Credit Union report issued September 10, with employment shrinking 4% this year.;
‘The economy in the region – which includes Fort St. John, Fort Nelson, Tumbler Ridge and Dawson Creek – is heavily reliant on its resource base. One of the biggest factors limiting growth, said the association, is coal.’
‘According to Bryan Yu, Central 1 economist, although some sectors will see expansion in the short term, low coal prices have led to mines being idled and development being cut down. This is not the only reason growth will be limited, he said. “Despite positive natural gas and forestry production, growth will be limited by modest gains in the agriculture sector, an exceptionally weak market for coal and reduced commodity exploration,” Yu said.’
‘Being able to adapt to changes in personal circumstances is important. This is being demonstrated as the flow-on effects from the post-mining slowdown are being felt in former boomtowns like Perth and many regional areas.’
‘Brokers – especially those located in South Australia, Western Australia, Queensland and the Northern Territory – with clients in mining and related industries are likely to have a number of clients whose changing circumstances may impact on their immediate and long-term finances. Clients could be returning to capital cities and taking jobs that don’t have the same high salaries they’ve become accustomed to, or they might have only had the house for a few years and therefore don’t have a lot of equity in their property on which to capitalise.’
‘Some of the fly-in-fly-out clients we see at Fair Go Finance have multiple debts including a mortgage, car loan, credit cards, or loan(s) for boats or jet skis.’
‘The other segment of a broker’s client base that might have been impacted by the slowdown is investors. Many people capitalised on the boom by buying properties in mining towns, but are now stuck with mortgages while property values and rental yields have taken a tumble.’
” Many people capitalised on the boom by buying…with mortgages”
It’s an ironic mark of our credit mania that a word once meaning to deploy money now means to deploy debt. Debt will show itself to be like anti-matter to capital.
‘More than 269,000 California public school students – about 4 percent of all students, double the national average – don’t have a consistent place to call home at night, according to a state report released Wednesday. More than half of these homeless students are in pre-kindergarten through 5th grade.’
‘They are doubled up with friends or relatives, living in motels or shelters, or sleeping in cars or on the ground in parks. In the aftermath of the economic recession and with housing prices high, their numbers are rising, the report found.’
‘According to the new data, 86 percent of homeless students are doubled up with friends or relatives, a situation that is not as comfortable as it might sound, said Brenda Dowdy, a liaison between school and homeless students in San Bernardino County who spoke on the press conference call. She said she visited a house that had 21 children and their parents staying in it. Some of the homes being used by multiple families may not have running water or a refrigerator, Dowdy said.’
“I’ve gone on home visits where you have a mattress in a closet and they’re looking at it as a room,” said Melissa Schoonmaker, a liaison between school and homeless students in Los Angeles County.’
Who needs running water when the weather is so nice?
Doubled up with friends or relatives. How is that homeless? Maybe inconvenient and not to the liking of the people involved, but not homeless. And what effort is made to distinguish those temporarily in this situation from those permanently with relatives? Are any of these children of migrant workers or recently entered staying with relative types?
Just more BS crap stats wanting to justify more money from Uncle Sugar.
But I thought all these people were being cared for with SNAP, Section 8, Obamaphones, a free Escalade and annual passes for Disneyland.
That comes after the election when they are made legal.
Doubled up with friends or relatives. How is that homeless?
I suppose you could get thrown out at a moments notice. Still better than sleeping under the stars.
21 kids and their parents in a single house. I wonder what 1960’s Californians would have thought or said if they could have caught a glimpse of what was in store for the Golden State: astronomical housing prices, high unemployment, the Mexodus and the third worldification of their state.
And in other parts of the state high school kids drive cars that are worth more than my annual salary.
Welcome to the third world. CA is traditionally a trend setter for the rest of the country.
And in other parts of the state high school kids drive cars that are worth more than my annual salary.
It’s good to be the king.
I’m noticing the high pressure off the Cali coast is already acting up again this September. What a wonky weather pattern has befallen the coast. I think the jet stream is broken.
the best time of year is Sept in CA. like most places.
houston confusion
movoto
http://www.movoto.com/houston-tx/market-trends/
shows it’s booming vs the report posted here
Price slashing up 86% and a tidal wave of new listings in houston.
Yup. Booming.
The Las Vegas Sun in Nevada.
An ongoing fight from Las Vegas City-Data has moved into the comments for this article like a bar fight spilling out into the street. Hysterical.
I’m rooting for Trader Joe
Yes I have just moved to the Las Vegas area and the prices from even a year ago are insane. If you look at what the job market can support it is not 500K houses. The worst area is the Summerlin area that thinks it is the next Irvine, CA…..it is alright but it is still Las Vegas.
Local Vegas realtor report on Summerlin
Don’t know anything about Irvine. I guess the NY equivalent is Scarsdale, Rye, Larchmont (wealthiest areas minus the beautiful weather)?
“If you look at what the job market can support it is not 500K houses.”
+1 Looks like you swallowed the Red Pill. Congrats!